More Campaign Finance Deregulation

April 11, 2014

In McCutcheon v. Federal Election Commission, a 5-4 majority of the Supreme Court of the United States shared a judgment that Congress had acted unconstitutionally in enacting aggregate limits for what an individual can give to federal candidates, party committees and political action committees. The majority believes that the aggregate limit had no meaningful role in preventing corruption and they believe it deprived Americans of the opportunity for robust expression of their First Amendment rights.

The five believe that only quid pro quo corruption – the direct exchange of money for a vote – can be regulated. Eight of the justices still concur that limits on contributions to an individual committee are, for now, an acceptable safeguard against vote-buying.

Writing in dissent on behalf of four justices, Justice Stephen Breyer argued that there are fundamental First Amendment rights for the common citizens at stake: The right to be heard, at all, in our political process. Justice Breyer also argued that the aggregate limit is a prophylactic against corruption because it can limit circumvention of contribution limits for individual committees, among other reasons.

Importantly, Breyer also said that judges are poorly equipped to know the corrupting nature of money in politics. He said that the Court should defer to the legislators who had experience in the arena of politics. He chided the majority for overturning an act of Congress with no evidentiary record, only their legal interpretation.

Breyer is certainly right about the lack of direct political experience. Since the untimely retirement of Justice Sandra Day O’Connor, who had been a state senator in Arizona, that experience is completely absent in the Court’s collective background. Justice O’Connor had supported Congress’s right to regulate campaign finances beyond what the current Court will allow.

When Congress last passed major campaign finance legislation in 2002, one of its central actions (the one that still survives) was to prohibit the national political parties from soliciting unlimited soft money contributions from persons or any sort of corporation. In an evidentiary record consisting of more than 100,000 pages and including testimony from more than 200 persons, corruption—beyond simple bribery—was a central concern. Consider some of the testimony in McConnell v. FEC (2003) that was cited in an appendix to Justice Breyer’s dissent in McCutcheon:

Sen Fred Thompson (R-TN): “We have gone from basically a small donor system where the average person believed they had a stake, believed they had a voice, to one of extremely large amounts of money where you are not a player unless you are in the $100,000 or $200,000 range [or more].”

Sen Alan Simpson (R-WY): “Too often, Members’ first thought is not what is right or wrong or what they believe, but how will it affect fundraising.”

Sen David Boren (D-OK): “I know from my own experience and from my interactions with other Senators that they did feel beholden to large donors.”

Sen Warren Rudman (R-NH): “I understand that those who opposed passage of the Bipartisan Campaign Reform Act, and those who now challenge its constitutionally in Court, dare elected officials to point to specific [instances of vote buying]. I think that misses the point altogether. [The access and influence accorded large donors] is inherently, endemically, and hopelessly corrupting. You can’t swim in the ocean without getting wet; you can’t be part of this system without getting dirty.”

The new weapon that McCutcheon spawns in the political arms race is the enhanced joint fundraising committee. It has been noted widely that an individual could give $1.2 million to party committees each election cycle and/or $2.4 million to federal candidates through a single joint fundraising committee. But don’t forget about leadership PACs. The newly liberated donor can also send $5,000 per year to his or her favorite legislators’ leadership PACs through a JFC. That money can be converted to personal use by the officeholders, at least in retirement. Get together with nine friends or family members and a donor can send every member of his or her favorite caucus $102,000, $50,000 of which can be converted to personal use.

Even though the congressman who aggregates contributions doesn’t get to keep all the money he collects, imagine what it does for his position in the caucus. Imagine what it can do for the donors’ policy interests.

One can almost hear the speech the “aggregator” congressman gives before handing everyone in his conference $102,000: “My friends and your benefactors don’t want anything from you. But, you know what they like and you know what they don’t like. I’ve got a memo for you, in case you might forget.”

How big is this going to be? Last election cycle just 591 Americans hit the $46,200 aggregate limit for candidates; the limit that so vexed Shaun McCutcheon he filed suit. Just twelve of those donors were Michiganders. However, this green light from the SCOTUS could be just what it takes to change the culture of political giving, once again. Whatever their number, America’s most potent influence-buyers just got a big new opportunity without having to go through the messiness of dealing with Congress. Now, when they do deal with Congress, the financially privileged will be able to get the Members’ attention more firmly and more efficiently.

Isn’t it an irony that the strongest force in reshaping American politics in the 21st Century is the “non-political” branch of government?

Visit www.mcfn.org to see a Michigan-based hypothetical example of how a joint fundraising committee can work.